Why Rackspace wanted ObjectRocket

It's all about MongoDB in the cloud, baby.
Written by Andrew Nusca, Contributor

If you haven't heard, San Antonio-based IT hosting company Rackspace announced this morning that it would acquire Boston-based MongoDB service ObjectRocket for an undisclosed sum.

(You can read my ZDNet colleague Sam Shead's original report on the news here.)

If you're unfamiliar with MongoDB, it's a scalable, open source NoSQL database system that promises speed and stability in the cloud.

The acquisition is Rackspace's eighth since 2007, and represents another big cloud bet for the Texan company.

I wanted to know more, so I rung up Pat Matthews, Rackspace's senior vice president of corporate development, and Chris Lalonde, chief executive and co-founder of ObjectRocket, to discuss a few details of the deal.

Needless to say, there was a mix of excitement and relief in their voices.

Here's what they told me.

ZDNet: How are we feeling, gentlemen?

PM: We're super excited about it. This acquisition will bring to bear a database-as-a-service option.

We're really excited to get into the MongoDB market. We're excited to have these guys join Rack.

ZD: This is Rackspace's eighth acquisition in about six years. What does it take for Rackspace to acquire a company?

PM: I was the CEO of the first company Rack acquired, [Webmail.us,] in 2007. I started with our M&A group about six months ago.

We're spending a lot of time thinking about what technologies are really core to us. Especially core to our cloud stuff.

The question is always, build or buy? We're obviously going to keep partnering, but if we want to buy it, is somebody available for purchase? You can have every desire to acquire a company, but if the right team or technology isn't available, you can't do it.

With ObjectRocket, as a cloud provider, we're thinking a lot about expanding our database market. We want to expand into the MongoDB space -- it's getting traction, we like it -- and then it's, do we build or acquire? We met some companies in the space and with ObjectRocket, the stars really aligned. We like the people -- they'll make good Rackers -- and it quickly became an easy decision. We had a good solid meeting of the minds, and here we are.

ZD: Chris, let's hear it from your side of the table.

CL: First and foremost, super-excited about the acquisition. Like Pat said, for us, one of the key deciding points was meeting staff and understanding the Rackspace culture. A lot of their core values align with our core values -- the people, the best product, a premium service, supporting customers.

We started up a year ago, got some angel funding, got a public beta [going] and now we're taking those customers to production.

ZD: And here you are, a year later, scooped up.

CL: (laughs) I don't think anybody envisions it happening this quickly. It's been a fantastic ride. We never sort of went into, "OK, we'll get acquired within a year." We had the general entrepreneurial plans of getting an A round [of funding] and pushing things through.

The opportunity at Rackspace is phenomenal -- to get the support, to expand. We built our own cloud, our own infrastructure. With regard to global expansion, the challenge is getting out there. Rackspace allows us to step on the accelerator.

For us, the sky is sort of the limit. Already, we've gotten a lot of international interest in using the platform. One of the hot things for us to do is service customers not just in North America but globally. The U.K. -- Europe, really -- is pretty hot. You can follow the Mongo markets.

We only use SSDs in our platform, no matter what the instance size is, and that's attractive to customers. Expanding horizontally easily is also attractive. I literally had someone tell me the other day, "I can't wait until you get into the U.K."

ZD: What's next, gentlemen?

PM: We think this is going to be a big business. It's time to go grow it. These guys are at that very exciting point as entrepreneurs. They built an awesome product, and now it's time to go out there and put some scale behind it.

We want to bring Mongo and the cloud to the world, and we think we've got a good shot at doing that. Whether it's with VC money or within a company, there are going to be lots of challenges and opportunities for a startup. I'm excited to have Chris and his team join Rackspace. We're the home of fanatical support. It starts with expertise around technologies that we can bring to market. It's important to us to have that in-house.

In terms of how it fits with our overall mission, it fits very well. MongoDB is open source, and we build our company on that. With Mongo, it's so easy to get going with it -- but once you hit real scale on it, and companies are using it in production, it's hard to scale. It's challenging technology.

Our challenges ahead are really just growth-related. We've gotten so much demand for our customers for Mongo services that when you take a well-done product like the one that ObjectRocket has built, we will do very well at getting the customers. Like any technology in the world, it's scale, and we'll have scaling challenges. It's just like in any business. But those are exciting challenges to have.

It's also database technology, and that's fundamental to any application or cloud.

ZD: And then there's integrating the two teams.

PM: Integration is top-of-mind, but that's why I worry less about it. One of the biggest things I'm most passionate about at Rackspace is bringing people on board and making it go really well. Many acquisitions don't go the way people thought they would on a spreadsheet. Five and a half years later, I'm still here and having fun. There are a lot of things we've done right and wrong, and I'm making it my mission to do more things right than wrong.

ZD: Will the ObjectRocket guys continue to operate as usual, or will there be tighter integration? Boston and San Antonio are quite different at this time of year. 

PM: We don't require everybody to move to Texas. (laughs) The ObjectRocket team is very small but distributed. We wanted to figure out how to get them excited about coming together as a team to get excited. They're actually moving to Austin, not even to our headquarters.

CL: We're looking forward to the barbeque.

ZD: Yes, that's right. Austin is not a bad place to be.

PM: We've got a huge mission to take on together. Small teams working together is really important. To give this deal the highest likelihood of hitting all the outcomes, having that team together was important. We even talked about having them move to San Francisco. They're just three people -- a wee, nimble startup.

We generally like people in Texas, as close to San Antonio as possible, especially if you want to be a leader. I think these guys are going to be leaders in this company.

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